Rupee closes weaker against dollar at 62.37
The rupee closes 7 paise weaker after touching a high and a low of 62.30 and 62.39, respectively, in intra-day trade
Mumbai: The rupee weakened against the US dollar on Friday as dealers avoided taking fresh positions, noting dollar demand from state-owned banks, likely on behalf of the Reserve Bank of India (RBI), which has checked any large gains in the rupee.
State-owned banks have been buying the dollar on every gain in the rupee to prevent the Indian currency from rising sharply.
The home currency closed at 62.37, down 0.1% from its previous close of 62.30. The local unit opened at 62.34 per dollar and touched a high and a low of 62.30 and 62.39, respectively.
“Trade is very thin because the rupee has been held in a tight leash by RBI. There is no incentive to take any position," said a dealer with a French bank.
The benchmark S&P BSE Sensex index fell 0.78% to close at 28,442.10 points.
The yield on India’s 10-year benchmark bond was trading at 7.796% compared with its Thursday’s close of 7.8%. Bond yields and prices move in opposite directions.
RBI has extended government bond trading by 30 minutes to 5.30pm local time, two traders said, citing a message on the central bank’s dealing system. Trading was extended as technical problems caused delay in the announcement of auction results, Bloomberg reported quoting one of the traders,
Since the start of 2015, the rupee has gained 0.87%, while foreign institutional investors have bought $6.33 billion from local equity and $6.89 billion from bond markets.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.291, down 0.13% from the previous close of 97.415.
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